Bumimetro Constructions Sdn Bhd v Macvilla Sdn Bhd (in Liquidation) (WA-28PW-550-10/2022)

the Applicant be granted an extension of time to make this application, and

(ii) The decision of the Liquidator in the Notice of Rejection of Proof of Debt (“POD”) dated 09.06.2022 be reversed, and costs of this application. [2] The Applicant had withdrawn the other prayers in Enclosure

[3] I allowed prayer (i) for extension of time to file this application for the following reasons.

The 1st Applicant had replied to the Notice of Rejection of POD within 2 days of receipt of the notice (Exhibit WCW-29 of the Affidavit in Support (AIS)). The 1st Applicant had replied to the Liquidator with a letter dated 28.06.2022 enclosing the additional documents requested by the Liquidator.

In addition, I agree with the Applicant’s averment that the delay was also partly due to the Liquidator failing to reply to the 1st Applicant letter dated 28.06.2022.

The Liquidator had taken approximately 5 months to reply to the 1st Applicant’s POD.

In any event I find the Liquidator has not suffered any prejudice caused by the delay in filing this application when the delay was partly contributed by the act of the Liquidator himself. [4] For the above reasons I will exercise by discretion to allow the extension of time prayed for in paragraph (i) of Enclosure 1 under rule 193 and 194 of the Winding-Up Rules 1972. REJECTION OF POD BY THE LIQUIDATOR [5] Section 517 of the CA 2026 provides: “Any person aggrieved by any act or decision of the liquidator may apply to the Court which may confirm, reverse or modify the act or decision complained of and make such order as it thinks just.” In the Notice of Rejection, the Liquidator has stated his grounds of rejection to be: a) Insufficient supporting documents/records to substantiate and support the claims against the company. b) The Applicant failed to provide certified copies of contract, invoices, statements, certificates and any related documents to prove the debt owing c) The Respondent has a counterclaim against the 1st Applicant for liquidated damages and further payment made on behalf of the 1st Applicant to numerous parties including its suppliers and nominated subcontractors. CONSIDERATION OF THE COURT IN THIS APPLICATION [6] The principles which this court need to consider in any application of this nature has been explained in the High Court case of Oris Leasing Malaysia Berhad v Rossigton Consolidated Sdn Bhd (Dunheved Industries Sdn Bhd, applicant) [2015] MLJU 1902 (Tab 6 of ABOA). The court will need to decide on the following matters: “A creditor who is dissatisfied with Liquidator’s decision in respect of proof of debt may apply under rule 93 of the Companies (Winding Up) rules 1972 to reverse, vary of modify that decision and only in exceptional circumstances to obtain leave to institute legal proceedings against the company. At the hearing, either party is therefore entitled to adduce fresh evidence in support or otherwise of the proof. Rule 93 of the said Rules reads, “If a creditor or contributory is dissatisfied with the decision of the liquidator in respect of a proof, the Court may, on the application of the creditor or contributory, reverse or vary the decision; but subject to the power of the Court to extend the time, no application to reverse or vary the decision of the liquidator in a winding up by the court shall be entertained, unless notice of the application is given before the expiration of twenty-one days from the date of service of the notice of rejection.” In such an application, the Court has to decide: a) Whether the liability referred to in the proof of debt is a true liability of the company enforceable against it; and b) In the event it is a true liability whether the Liquidator has acted correctly in rejecting the proof of debt. [7] The 1st Applicant submits that the sum stated in the Proof of Debt (“POD”) arose from the balance owed to it in the Final Statement of Account for the said Project which was signed, agreed, and acknowledged by the Respondent before the Winding-Up Order. The Final Statement of Account was agreed by 1st Applicant and the Respondent. There is therefore a valid and enforceable liability against the Respondent and as such the Liquidator had no grounds to reject the POD. [8] The First grounds of rejection of the POD cited by the Respondent is the alleged insufficient supporting documents/records to substantiate the claim against the Respondent. [9] My findings on this issue are as follows:

The sum of RM22,594,668.63 in the POD arose from the balance in the final Statement of Account of the said project which was signed and acknowledged by the Respondent before the Winding Up Order. It is not for the Liquidator to invalidate what has been agreed upon by the parties before the Winding-Up Order unless there is any allegation and evidence of fraud/collusion between the 1st Applicant and the directors of the Respondent which there isn’t.

The POD had highlighted all the payments made by the Respondent in the form of payments to the Nominated Subcontractor, payment by the Respondent in the form of cash, online payment, credit notes etc. The balance which is still owing then formed the basis of the POD.

After the filing of the POD, upon the allegation by the Liquidator that the POD was not supported by sufficient documents, the 1st Applicant provided the Liquidator with further documents including the certificate of payments issued by Arkitek WHL which confirmed direct payments made by the Respondent to the Nominated sub-contractors as contained in Exhibit B of the POD, thus proving there were no overlapping claims by the 1st Applicant.

It is clear from the correspondence between the parties that the Liquidator is determined to reject the Applicant’s POD no mater how many documents the Applicant produced to support it’s claim for payment. There is an apparent bias against the 1st Applicant by the Liquidator.

I also note that the Liquidator had not called for any meeting with the 1st Applicant for it to explain any discrepancies or to clear any doubts the Liquidator may have had concerning the documents filed with the POD. [10] The Second grounds for rejecting the POD given by the Liquidator was the alleged counter-claim for Liquidated and Ascertained Damages (LAD charges) by the Respondent against the 1st Applicant. [11] With respect to the above alleged LAD charges, the 1st Applicant submits that time was at large and the delays to the Project was attributable to the Respondent (see Exhibit WCW-30 and WCW-31 of the 1st Applicant’s AIS). [12] I have also taken note that despite the issuance of the certificate of non-performance, the Project Architect had continued to issue interim payment certificates and continued making some payments to the 1st Applicant. [13] Finally, even if there was some basis for LAD to be imposed by the Respondent, it is clear that this would not warrant to total rejection of the 1st Applicant’s POD, since the alleged claim for LAD only amounted to less than half of the sums claimed in the POD. That is evidence that the Liquidator was quick to reject the 1st Applicant’s POD without carrying out a full investigation into the said POD. [14] With respect of counterclaim allegedly due to further payments made by the Respondent to numerous parties including the 1st Applicant’s subcontractors and nominated subcontractors, the only claim brought to the Applicant’s attention by the Liquidators in relation to this matter was by one of nominated subcontractors, Multi Highlight Sdn Bhd (Exhibit WCW-12 of AS). The Applicant had addressed and responded to this issue in a letter by its solicitor dated 11.11.2021 (Exhibit WCW- 20 of AS). The Liquidator similarly failed to request for more information or clarification on the matter. [15] Therefore, I find on a balance of probability the 1st Applicant has proven the Respondent’s liability and this the rejection of the POD is without basis. I find that the Liquidator had acted unreasonably and had failed to consider all relevant matters. It is clear that the Liquidator had failed to carry out a proper and independent investigation into the POD filed by the 1st Applicant (see the case of Andrew Christopher Chuah Chong Eng v Ooi Woon Chee & Anor (2007) 2 MLJ 12. [16] Therefore I allow this application by the 1st Applicant in Enclosure 1 with costs. Dated 10 April 2025 …………t.t….……………. Ahmad Murad Bin Abdul Aziz Judge High Court of Malaya Kuala Lumpur COUNSEL FOR THE APPLICANTS: DIVESH MEHTA SOLICITORS FOR THE PETITIONER: TETUAN SIONG & RITA COUNSEL FOR THE RESPONDENT: YEO YEN HOCK SOLICITORS FOR THE RESPONDENT: TETUAN SHUI-TAI Cases Referred to: ➢ Oris Leasing Malaysia Berhad v Rossigton Consolidated Sdn Bhd (Dunheved Industries Sdn Bhd, applicant) [2015] MLJU 1902 ➢ Andrew Christopher Chuah Chong Eng v Ooi Woon Chee & Anor

2 MLJ 12 Legislation Referred to: ➢ Winding-Up Rules 1972 Decision date: 21 August 2025